Not upheld: early withdrawal charges and adviser change complaint against St. James's Place Wealth Management Plc

Decision detail

Summary

Mrs K complained that St. James's Place unfairly assigned her a new adviser without consultation following the departure of her original adviser when the appointed representative relationship ended, and sought waiver of early withdrawal charges on her pension. Mrs K argued the adviser relationship was fundamental to the service she agreed to, that the change materially altered the value proposition, and that retaining the charges breached Consumer Duty and fair treatment principles. The ombudsman found that the early withdrawal charge was a payment for setup services already provided rather than payment for ongoing advice or a guarantee of adviser continuity, that St. James's Place acted reasonably in providing a replacement adviser, and that Mrs K retained options to seek advice elsewhere or transfer providers without the charge being an unreasonable barrier. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that the early withdrawal charge was a payment for services already provided (setup costs) rather than payment for ongoing advice or a guarantee of a particular adviser's continued service. While St. James's Place markets long-term relationships, this could not be interpreted as a guarantee that a particular adviser would always remain in place, as it is expected that agents move and organisational arrangements alter. The ombudsman concluded that Mrs K was not misled about this and that changing the servicing agent did not constitute a fundamental breach of the agreement. The charge was not an unreasonable barrier to switching providers given its rationale was to recover setup costs that would otherwise be charged upfront. Mrs K retained the option to seek advice elsewhere or transfer her pension to another provider.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website